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Comment by amilios | Hacker News Reader

Whats the rebuttal to UBI just causing massive inflation again?

I'm not a fan of UBI, but long term inflation is primarily determined by money creation rates. If UBI was funded by taxes, not printing, then we wouldn't expect any significant effect on long term inflation rates, although there might be some disruption in the short term.

I mean is it determined by money creation, or just influenced by/one of the factors? If business perceive people generally having more spending money, won't they raise prices accordingly?

Shouldn't they lose to a competitor who's happy to keep the lower margin and dominate the market?

If not, I'd call that a failure of anti-trust law, not UBI.

What if everyone raises prices simultaneously proportional to the UBI?

In the absence of collusion, if a business can produce a product or service less expensively, giving them the ability to outcompete competitors, they will do so.

Even if UBI is funded by taxation, rather than deficit spending, isn't it possible that demand will increase for some products (e.g. basic necessities that UBI recipients will suddenly be able to spend more on), causing inflationary pressure on the prices of those products?

By that argument, UBI causes both inflation (for essential goods and services) and deflation (for luxury items and assets).

That's the economy reorienting itself around the new demand landscape. Those price spikes are the signal to producers to ramp up supply, which should push the price back down over time.

Inflation is highly problematic when it spirals. Events like collapse of trust in a currency or government can result in runaway inflation, which is a disaster by all accounts. A one-time price spike caused by a one-time abrupt shift in demand is a very different scenario. Assuming the UBI is higher than the prices increases on necessities, we've successfully redistributed wealth and made those people better able to afford necessities, despite the fact that they cost x% more.

It's (mostly) determined by the delta between money creation and creation of "stuff" (by which I mean services as well as goods). If there's more stuff, then creating the same amount more money isn't inflationary.

I said "mostly" because there can be things like supply shocks... but I guess that means less stuff, so maybe even that isn't an exception.

UBI is just wealth flowing from the government to all individuals. The goal is redistribution. As a government, you can explicitly specify who wealth is being taken from by paying for UBI in taxes. If you don't raise taxes to balance the budget, your choice is between kicking the can down the road with debt or printing money. Printing money is really just another form of redistribution drawn from the wealth of everyone holding that currency. Naturally, doing so can lead to a crisis of confidence where the value of the currency collapses as people flee to other assets that are less likely to be devalued.

UBI, like any government spending, needs to be paid for. By taxes or financial disaster. I prefer taxes, personally.

UBI is a more efficient allocation of already existing government services. Instead of a program for each and ever need a person may have, they're just given cash and those programs would be deprecated. It's more efficient. The rebuttal is sourced from those that have existing vested interest that these antiquated piece-meal programs continue to operate.

I've never been a fan of UBI (and I'm often downvoted for that, ha ha). I like the idea of mandating an 18 hour work week or similar though. It still keeps the incentive to work — still rewards those who want to achieve more.

One wonders though what impact that will have on society — so much additional free time. More television binging? I hope not.

Why do folk "need" to work? To justify their existence? Don't we have a duty of care for fellow humans?

Many people work so that other people don’t let them starve or put them in prison.

Folk need to work to justify their existence to themselves. Just yesterday, there was an article here about why people feel bad about themselves when they aren't being productive.

Our own psychology aside, people need to work because at present robots cannot make all the stuff we want. So if we (society as a whole) want all this stuff, then we need to work.

We have a duty to treat our fellow humans with dignity and humanity. I'm not sure that extends to providing for those who can work but won't, though - not when there's work that society as a whole needs done.

Curiously, and this is probably just me, but I find I need to work in order to enjoy (value) my leisure time. Odd, I know.

OK, then work. If I enjoyed 5:30am wake-up times, I wouldn't require others to replicate it.

To be sure. I was only answering as to why I find I need some sort of work.

That is an American mindset: your job makes who you are. Like you have no identity without a job. Mainly because without a job you loose health insurance, housing, everything.

I am not seeing how the two are mutually exclusive.

I think there needs to be a pretty fundamental shift in society for us to continue to function if, for example, everyone was essentially on welfare. Not sure what they are supposed to all be doing in the "Star Trek universe" for example. Somehow "Logan's Run" comes to mind — you know, if we actually still got together with each other. ;-)

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